Does this mean it's a good time to buy their debt? We might be looking at a decent ROI? Or am I completely misunderstanding this? (I might be, I'm not a whatever-it-is-that-is-an-expert-in-is-field-ologist)

Does this mean it's a good time to buy their debt? We might be looking at a decent ROI? Or am I completely misunderstanding this? (I might be, I'm not a whatever-it-is-that-is-an-expert-in-is-field-ologist)

I am likewise not an investment expert and may no one's portfolio be guided by this comment, but I understand it to mean that Moody now considers investing in Nokia to be riskier now than before.

Does this mean it's a good time to buy their debt? We might be looking at a decent ROI? Or am I completely misunderstanding this? (I might be, I'm not a whatever-it-is-that-is-an-expert-in-is-field-ologist)

The ratings differ depending upon the agency, but in general, the lower the rating, the higher the risk. Of course this also means potential for higher rewards. Nokia is now one step above "junk," a term that describes an entity with little hope of repaying its debts.

At least Nokia is being honest and accepting a bit of short term pain for long term gain. Something that cant be said about many companies and countries (including the US) out there. Especially the banks that continue to cook their accounting to this day (Until all of their junk is transferred to the taxpayer via Fannie and Freddie).

Does this mean it's a good time to buy their debt? We might be looking at a decent ROI? Or am I completely misunderstanding this? (I might be, I'm not a whatever-it-is-that-is-an-expert-in-is-field-ologist)

I am likewise not an investment expert and may no one's portfolio be guided by this comment, but I understand it to mean that Moody now considers investing in Nokia to be riskier now than before.

Damnit CJ! You're a physicist, that makes you an expert in every field!I'm kidding, of course, but thanks for the clarification. MrMcLargeHuge's post also clears things up.

That this transition would be rocky should not have been news to investors. The ramifications of the burning platform memo should have sent weak kneed investors fleeing a long time ago. I think NOK is strong long term. The Lumia line is building good brand recognition and has better differentiation than all handsets save the iPhone. Tango will let them redefine the budget handset space instead of the current war of attrition that is going on. WP8+Lumia will go head to head with the iPhone and benefit from a huge Win8 marketing push. Btw s/will/i think will (for the anal)It is indeed risky, though.

Does this mean it's a good time to buy their debt? We might be looking at a decent ROI? Or am I completely misunderstanding this? (I might be, I'm not a whatever-it-is-that-is-an-expert-in-is-field-ologist)

I am likewise not an investment expert and may no one's portfolio be guided by this comment, but I understand it to mean that Moody now considers investing in Nokia to be riskier now than before.

Damnit CJ! You're a physicist, that makes you an expert in every field!I'm kidding, of course, but thanks for the clarification. MrMcLargeHuge's post also clears things up.

Does this mean it's a good time to buy their debt? We might be looking at a decent ROI? Or am I completely misunderstanding this? (I might be, I'm not a whatever-it-is-that-is-an-expert-in-is-field-ologist)

I am likewise not an investment expert and may no one's portfolio be guided by this comment, but I understand it to mean that Moody now considers investing in Nokia to be riskier now than before.

You're largely correct: Moody's is now considering it to be riskier. The normal response in the bond market is to make Nokia's bonds cheaper in reaction which would push up yields (and ROIs). In other words, if there's no default, you'll make more money. So if you have a strong belief in Nokia's long term prospects, and ratings by firms like Moody's holds no sway with you then, yes, the cheaper price should make you more willing to invest in their debt.

Does this mean it's a good time to buy their debt? We might be looking at a decent ROI? Or am I completely misunderstanding this? (I might be, I'm not a whatever-it-is-that-is-an-expert-in-is-field-ologist)

Nokia should hurry up and sell themselves to Motorola Mobility so they don't have to live on as a Patent Troll.

In selling to MoMo, they're really selling to Google which could then use those patents to "defend their IP" from Apple or MS. OR they could use it to troll others, it depends on their mood. Kinda self-defeating.

Does this mean it's a good time to buy their debt? We might be looking at a decent ROI? Or am I completely misunderstanding this? (I might be, I'm not a whatever-it-is-that-is-an-expert-in-is-field-ologist)

These are the rates, but you've got to remember that the rates correspond to risk, not the other way around. There's never really a "good time" when the rates change due to the risk changing, it's only a good time if the rate goes up due to other reasons (like a contraction in the market on available funds to lend, it means borrowers willingly pay more to get money without an increase in risk).

It's also not all of Nokia's debt that's rated as near-junk, their short term isn't bad (but the rates did climb substantially as a result of recent information as it too was downgraded). It's really unlike that Nokia won't be able to pay their debt in 2014, but their long term stuff, especially with their recent cash burn and shrinking market presence, makes buying debt maturing 27 years from now somewhat riskier (thus the almost 8% yield). At the same time, if you decide you want to get out early you might need to resell at a loss, offsetting the rates you get in the meantime. If Nokia did take a nosedive and looked unlikely to even meet their 2014 debt, then that's really, really bad for you. Thus the risk/reward thing.

None of this is financial advice either, just trying to make you a little more aware. I rarely trade in anything and often lose money when I try, but I did do a commerce degree

That this transition would be rocky should not have been news to investors. The ramifications of the burning platform memo should have sent weak kneed investors fleeing a long time ago. I think NOK is strong long term. The Lumia line is building good brand recognition and has better differentiation than all handsets save the iPhone. Tango will let them redefine the budget handset space instead of the current war of attrition that is going on. WP8+Lumia will go head to head with the iPhone and benefit from a huge Win8 marketing push. Btw s/will/i think will (for the anal)It is indeed risky, though.

The transition was of course going to be rocky, but analysts think they might run out of money before the holidays. That is beyond a rocky transition - that's no transition. That would mean the Lumia WP7 phones barely had a year of life and that their flagship phone didn't make it a year.

I was shocked at this news this weekend, I had thought MS's cash was enough for a year or two more (I'm not an analyst and didn't see the debt on the yahoo finance site). I think another year or two is minimum for WP to gain traction. Keep in mind they don't have a flagship phone on more than one carrier in the US and they don't have Tango phones afaict, when it appeared that MS tailored that release specifically for them. They were rumored to be making a W8 tablet, but that's obviously not done yet. WP8 isn't even out. It's hard to believe they'd run out of funding so soon. They are very much establishing themselves in smartphones and they needed to be funded for the long term. But MS has been hubristic in mobile, and Elop is from MS, so who knows?

Apparently there is no agreement from MS to keep Nokia afloat, but I think MS needs to do that, esp. if Lumia shows traction of any kind. MS has had nothing to show for their billions yet, if they're not walking away from mobile, they can't walk away from Nokia.

Apparently there is no agreement from MS to keep Nokia afloat, but I think MS needs to do that, esp. if Lumia shows traction of any kind. MS has had nothing to show for their billions yet, if they're not walking away from mobile, they can't walk away from Nokia.

that seems ludicrous to me, MS flushing money down the drain to keep Nokia afloat.there has to be more than one manufacturer for Windows phones, poor strategy if not.

Nokia should hurry up and sell themselves to Motorola Mobility so they don't have to live on as a Patent Troll.

In selling to MoMo, they're really selling to Google which could then use those patents to "defend their IP" from Apple or MS. OR they could use it to troll others, it depends on their mood. Kinda self-defeating.

The transition was of course going to be rocky, but analysts think they might run out of money before the holidays. That is beyond a rocky transition - that's no transition. That would mean the Lumia WP7 phones barely had a year of life and that their flagship phone didn't make it a year.

I was shocked at this news this weekend, I had thought MS's cash was enough for a year or two more (I'm not an analyst and didn't see the debt on the yahoo finance site). I think another year or two is minimum for WP to gain traction. Keep in mind they don't have a flagship phone on more than one carrier in the US and they don't have Tango phones afaict, when it appeared that MS tailored that release specifically for them. They were rumored to be making a W8 tablet, but that's obviously not done yet. WP8 isn't even out. It's hard to believe they'd run out of funding so soon. They are very much establishing themselves in smartphones and they needed to be funded for the long term. But MS has been hubristic in mobile, and Elop is from MS, so who knows?

Apparently there is no agreement from MS to keep Nokia afloat, but I think MS needs to do that, esp. if Lumia shows traction of any kind. MS has had nothing to show for their billions yet, if they're not walking away from mobile, they can't walk away from Nokia.

I do like their ad campaign, it's relevant and memorable.

It would be a bad decision on Microsoft's part to prop up Nokia IMO. Its a loose-loose situation: first if they actually do need to prop them up, then that means WP/Lumia is not selling as well as MS/Nokia expected it would. Second: when it leaks that MS is supporting Nokia, this would be interpreted as MS believing WP/Lumia wouldn't sell as well as expected, leading to further downgrades.

Well, a hundred shares of NOK shouldn't cost more than $420 right now and if they do manage to pull off a comeback might be worth a hundred times that amount in a decade. If they don't you'll be out $420.

This is supprising news, especially because Nokia seemed so well positioned.

It is clear that microsofts vision is for a tablet that is also your PC - place it near a monitor and keyboard, and use the normal windows interface for your content creation tasks, then pick it up and use it as a tablet for that meeting. It seemed like a pretty good plan, because tablets are awesome content consumption devices and a platform that did both would be a real inovation.And Nokia looked like the chosen partner to make this new tablet, getting first to market.

When a company is working on making a new product, they sink huge amounts of money into R&D, and don't get the benefit for a year or two, and that is what is sinking Nokia. It's okay for a startup, in that investors expect it to be rocky, and most startups fail. For a large company like Nokia to be functioning like a startup, down to the risk profile, is unusual, and going to scare the horses. Startups don't usually issue bonds.

So Nokia... will they make it through to next year, maybe with another MS cash injection, and start reaping the growth from that R&D (if any)? Or will they crash and burn, perhaps leaving a tablet division for microsoft to buy?I'll say one thing - last time microsoft bailed out a company like that, it was apple.

As a NeXT user at that time I wondered what my long-term options were (given that NeXT wasn't doing so well either). Some friends said I should forget desktop computers and look into a new up-and-coming platform called 'Palm'. Fortunately, I hung in there until Dec. 20, 1996. Unfortunately, I didn't buy any of their stock.

a) Elop is booted out (seems not, the deck chairs are being rearranged and the band keeps on playing)

b) Smartphone unit is sold to MS (with a variation where the Lumia unit is sold to MS and nothing more)

c) Nokia bought by a rival and scrapped for parts

d)

Quote:

The fourth scenario is that Microsoft buys Nokia outright. This is the desperation move by Ballmer, if some big rival comes to the scene and tries to make a hostile takeover bid for Nokia. Ballmer cannot let Nokia be sold to anyone else, because obviously - see above - any sane manager of Nokia will diminish immediately Lumia's influence and sooner or later will extinguish the underperforming Lumia line (vs MeeGo based smartphones). Ballmer doesn't want to buy Nokia but Microsoft can easily afford it. He would prefer to have Elop run Nokia as a Microsoft slave and let Elop gradually over time slim down Nokia by selling the non-smartphones related units like he has already tried to sell the NokiaSiemens Networks unit, and is currently in the process of selling the Vertu unit. But if a rival makes a move, Microsoft has to act and there will be a bidding war. That will turn out to be costly. The buyer whoever it is, will have to then split up the company they bought, and that means again, that the Nokia we now know, will no longer exist. The brand might live on, perhaps bought by a Chinese maker like a ZTE or Huawei or Lenovo or G'Five etc. But that will not be the Nokia we knew.

Incidentially, if Microsoft buys Nokia, that will be a repeat of when Microsoft bought Danger and launched Kin. It will not turn out well, the carriers will punish Microsoft and that version of Lumia will die even faster, than if Lumia is produced by an 'independent' Nokia run by Elop.

Join us at the Battlefront while you can, the Nokia Death Watch might be over soon!

@tigas: You seem to discount the future I think will occur:e) Nokia's low end presence diminishes and their unit volumes fall by 70%. Their high end presence picks up the slack such that even though they ship less than half as many phones, their actual margins and profits are double what they achieved with Symbian despite only getting 5% of the smartphone market.

Does this mean it's a good time to buy their debt? We might be looking at a decent ROI? Or am I completely misunderstanding this? (I might be, I'm not a whatever-it-is-that-is-an-expert-in-is-field-ologist)

I am likewise not an investment expert and may no one's portfolio be guided by this comment, but I understand it to mean that Moody now considers investing in Nokia to be riskier now than before.

This from the same bunch of clowns who brought us the mortgage crisis. If they say Nokia is more risky now, I'd say this is as good a time as any to go ahead and buy more of their shares and debt.

@tigas: You seem to discount the future I think will occur:e) Nokia's low end presence diminishes and their unit volumes fall by 70%. Their high end presence picks up the slack such that even though they ship less than half as many phones, their actual margins and profits are double what they achieved with Symbian despite only getting 5% of the smartphone market.

I am seeing this as well. I am long Nokia (only 150 shares) even though:

I hate Metro.I heart Apple.I wanted Meego

I think the user experience with Android used to be poor for people whose upgrade cycle is coming up. This will drive people who aren't happy with Android (a significant percentage) to alternatives like Windows Phone.MS will eventually get the phone OS to be good enough and the user experience is good already.

Edit: not long yet. Thinking about it based on buzz. Suspicious that some buzz is astroturfing since the 900 isn't sold out on AT&T as had been claimed. I can afford to wait a couple of weeks.